Stocks took their cues from a sizzling overnight session for the Japanese equities market and a red-hot post-earnings rally for Nvidia (NVDA). Indeed, the main benchmarks soared up the charts Thursday, with two of the three notching new record closes.
There were two main catalysts that sparked today's broad-market rally. One was the overnight move in Japan's stock market, with the Nikkei hitting a fresh record high for the first time since December 1989.
"The Nikkei has been buoyed by another wave of excitement for the prospects for the tech sector," says Susannah Streeter, head of money and markets at Hargreaves Lansdown, adding that a weaker yen has helped boost exporters including Toyota, Honda and Sony.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The index's "performance has also been boosted by corporate governance reforms to make businesses more accountable to shareholders which appear to have enthused investors, including Warren Buffett who has been bullish towards Japanese stocks," Streeter adds.
Nvidia soars on impressive Q4 results
The other main driver of Thursday's price action was Nvidia's blowout earnings report. The chipmaker's results were one of the most highly anticipated of the earnings season given its pole position in the generative AI (artificial intelligence) space, and it did not disappoint.
For its fourth quarter, Nvidia reported earnings of $5.16 per share, up from 88 cents per share in the year-ago period. Revenue jumped to $22.1 billion from last year's $6.1 billion as data center revenue quadrupled.
What's more, the company is calling for first-quarter revenue of $24.0 billion, a remarkable improvement over the $6.5 billion in revenue it reported in the year-ago period.
"This last year, we've seen a generative AI really becoming a whole new application space, a whole new way of doing computing, a whole new industry is being formed and that's driving our growth," said Nvidia CEO Jensen Huang in the company's earnings call.
NVDA stock surged 16.4%, adding $277 billion to its market capitalization – the most ever added by a company in a single session. To put that figure in perspective, it is more than the entire market cap of Dow Jones stock Coca-Cola (KO, -0.2%) or streaming giant Netflix (NFLX, +2.6%).
AMD adds $28 billion in market value after Nvidia earnings
Nvidia's earnings report had a halo effect on other chip stocks. Advanced Micro Devices (AMD), for one, jumped 10.7%, gaining $28 billion in market value along the way. Arm Holdings (ARM, +4.2%), Broadcom (AVGO, +6.3%) and Taiwan Semiconductor Manufacturing (TSM, +3.0%) were also notable gainers.
As for the indexes, both the Dow Jones Industrial Average (+1.2% at 39,069) and the S&P 500 (+2.1% at 5,087) finished at record closes. The Nasdaq Composite climbed 3.0% to 16,041, and is now within striking distance of its closing peak of 16,057.44 set in November 2021.
Related content
- Toyota Recalls More than 300,000 Vehicles: What To Know
- Why Is Walmart Splitting Its Stock?
- AT&T Working to Restore Service Amid Network Outage: What to Know
-
Stock Market Today: Have We Seen the Bottom for Stocks?Solid first-quarter earnings suggest fundamentals remain solid, and recent price action is encouraging too.
-
Is the GOP Secretly Planning to Raise Taxes on the Rich?Tax Reform As high-stakes tax reform talks resume on Capitol Hill, questions are swirling about what Republicans and President Trump will do.
-
Stock Market Today: Have We Seen the Bottom for Stocks?
Solid first-quarter earnings suggest fundamentals remain solid, and recent price action is encouraging too.
-
Social Security Is Taxable, But There Are WorkaroundsIf you're strategic about your retirement account withdrawals, you can potentially minimize the taxes you'll pay on your Social Security benefits.
-
Serious Medical Diagnosis? Four Financial Steps to TakeA serious medical diagnosis calls for updates of your financial, health care and estate plans as well as open conversations with those who'll fulfill your wishes.
-
What Wall Street's CEOs Are Saying About Trump's TariffsWe're in the thick of earnings season and corporate America has plenty to say about the Trump administration's trade policy.
-
To Stay on Track for Retirement, Consider Doing ThisWriting down your retirement and income plan in an investment policy statement can help you resist letting a bear market upend your retirement.
-
How to Make Changing Interest Rates Work for Your RetirementHigher (or lower) rates can be painful in some ways and helpful in others. The key is being prepared to take advantage of the situation.
-
When to Sell Your StockKnowing when to sell a stock is a major decision investors must make. While there's no one correct answer, we look at some best practices here.
-
Within Five Years of Retirement? Five Things to Do NowIf you're retiring in the next five years, your to-do list should contain some financial planning and, according to current retirees, a few life goals, too.
